Another day, another twist in the Banning Lewis Ranch bankruptcy.
Real estate development company Asset Ventures Fund I of Austin, Texas, withdrew motions Friday that it had filed two days earlier in U.S. Bankruptcy Court in Delaware, which sought to block the sale of the bulk of the sprawling ranch to oil-and-gas exploration firm Ultra Resources of Houston.
Ross Allen, an Asset Ventures spokesman, declined to comment on the reason for the company’s withdrawal, except to say there has been no settlement reached between Asset and Ultra.
Ultra officials couldn’t be reached for comment Friday.
Asset Ventures’ backpedaling left some real estate experts scratching their heads over what will happen next.
The Banning Lewis Ranch was annexed by Colorado Springs in 1988; at 21,500 acres, it makes up much of the city’s east side. Its owners, a pair of California limited liability companies, filed for Chapter 11 bankruptcy protection nearly a year ago, citing more than $242 million in debts. Other than about 300 homes on its northwest corner, most of the ranch has gone undeveloped since its annexation.
As part of the bankruptcy, the ranch was auctioned in June. Ultra Resources was the winning bidder for 18,000 acres and agreed to pay $26.25 million for the land.
Afterward, Ultra said it planned to drill for oil and gas, adding it had no intention of developing the property with homes and commercial uses that long have been envisioned on the ranch by developers and city officials. Since then, Ultra and the city of Colorado Springs have fought in court; Ultra wants to jettison land-use controls that were put in place by the city years ago, and the city is fighting to keep them.
On Sept. 15, a judge approved the sale of the 18,000 acres to Ultra, but the company’s purchase price was reduced to $20 million, according to court documents.
This week, Asset Ventures, which lost out on its bid to buy the 18,000 acres, objected to Ultra’s purchase. Among its arguments, Asset Ventures contended that the revised purchase price amounted to “a substantial and significant change in terms” and that other parties should have an opportunity to challenge it. Asset asked the judge to order a new auction.
Les Gruen, who heads the Urban Strategies land planning firm in the Springs and who worked in the 1980s for one of the ranch’s previous owners, speculated that Ultra and Asset have negotiated a settlement or are working toward a joint venture. Or, Gruen said, it’s possible Asset Ventures determined that its original objection wouldn’t stand up in court.
Contact the writer at 636-0228